Amcor has acquired South Africa’s Nampak Flexible in a move intended to allow it to ‘leverage our product innovation and design capabilities’ into the African market.
The 22 million USD acquisition of Nampak Flexible, the market leader in flexible packaging in South Africa, will provide Amcor with a ‘platform for growth’ in the African region, according to Amcor chief executive officer and managing director Ken MacKenzie.
Nampak Flexible has extrusion, lamination and conversion capabilities across three plants, and generates sales of approximately 94 million USD a year. The business services leading multi-national and domestic customers in the beverage, food and home care markets.
‘Nampak Flexible has an experienced management team and is the market leader in South Africa,’ MacKenzie said. ‘It services many of Amcor’s existing global customers and creates the opportunity to leverage our product innovation and design capabilities into this market.’
Nicholas Mockett, head of packaging mergers and acquisitions (M&A) at Moorgate Capital, said: ‘The flexible packaging industry is worth over 200 billion USD globally and is one of the highest growth segments of the packaging industry. This is spurred on by the rising global population and middle classes demanding more food and protein in particular.
‘Also social trends such as more working mothers and people moving from rural environments to cities drive the demand.
‘Flexibles is often seen as a high tech way to prolong the life of food, reducing food waste and therefore creating a more environmentally friendly supply chain.
‘The industry is still more fragmented than say glass or metal packaging but there has been significant M&A activity including Amcor’s acquisition of the Alcan businesses and Wendel’s acquisition of Constantia.
‘This latest deal for Amcor makes a lot of sense. Africa is a big opportunity for the packaging industry. As living standards rise the indigenous demand for packaging will rise. And Africa also produces food which is exported, e.g. to Europe, and is often packaged at point of production before it is shipped to reduce waste.’